Great info! But please provide a link.
Thank you!
A Time To Buy
Don't invest in mutual funds just before a capital gains distribution,
which usually occurs near year-end. If you do, you'll get a partial
return of capital, along with a tax bill.
Suppose that a mutual fund makes a $2-per-share capital gains distribution
in December. You'll get $2 per share while the fund's net asset value and
trading price drops by $2 per share. That $2 per share will be taxable
income to you, even if you invested the day before the distribution.
You'd be better off waiting until after the distribution to buy the fund.
Then you'll pay a lower price and avoid the tax bill. Therefore, check
with any mutual fund before you buy to find out the "record date" of the
distribution, then buy afterwards.
A Time To Sell
If you intend to sell mutual fund shares at a long-term capital gain, you
probably should sell before the year-end distribution. Such a distribution
might include long-term gains, short-term gains, and dividends that do not
qualify for the bargain 15 percent rate on stock dividends.
If you hold onto those shares until after you receive that distribution,
some of that payout (the short-term gains and nonqualified dividends) may
be subject to a federal tax rate as high as 35 percent. Instead, if you
sell before the distribution and you've held all the shares for more than
one year, all of your gain will qualify as long-term, with federal tax
rates at 15 percent or lower.
Swsop
Great info! But please provide a link.
Thank you!
"Treat your wife with honor, respect, and understanding as you live together so that you can pray effectively as husband and wife." 1 Peter 3:7
Rod,
Sorry, there was no link in the news letter about the article. It was in my Retirement & Financial Planning Report Issue. So I copy and paste the article on TSPtalk MB. But the website that offer this free newsletter is http://www.fedweek.com/ and http://www.fedretirement.org./
Swsop
Attachment 2861
I googled the link and sent it to you VIA PM so as to allow you to edit your own post.
"Treat your wife with honor, respect, and understanding as you live together so that you can pray effectively as husband and wife." 1 Peter 3:7
Full Newletter
http://www.fedweek.com/content/rc/index.php
Thank you.
"Treat your wife with honor, respect, and understanding as you live together so that you can pray effectively as husband and wife." 1 Peter 3:7
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